Carbon Mitigation Initiative

Tenth Year Annual Report:
Carbon Capture: Strategies for Promoting Mitigation

Alternative Approaches for Decarbonizing Existing Coal Power Plants

During 2010, a major activity of the Williams Group involved systematically comparing alternative options for decarbonizing existing coal power plant sites. In the U.S., the coal power plant decarbonization effort will be focused on existing power plant sites because overall electricity demand growth is expected to be slow. The analysis focused on alternatives to an existing written-off (fully depreciated) pulverized coal plant that vents CO2 (labeled WO PC-V). The decarbonization options considered were retrofitting existing pulverized coal plants with amine scrubbers to remove CO2 from flue gases (PC-CCS retrofit) and eight repowering options. The repowering options include three stand-alone power systems [a coal integrated gasifier combined cycle with CCS (CIGCC-CCS) and natural gas combined cycle (NGCC) plants with both CO2 vented and with CCS] and five systems providing FTL liquid transportation fuels as major co-products of electricity. The co-production options include both coal-only systems and systems that co-process coal and biomass.

The alternative systems were compared with regard to GHG mitigation performance, CO2 storage requirements, energy penalties for CCS, site water requirements, and economics. However, the emphasis was on carbon mitigation performance and economics. Findings for this analysis were presented by Williams at the GHGT-10 Conference.

A narrow definition of repowering is scrapping an existing power plant but keeping the site and its infrastructure for use by a new facility. Of course, there has to be enough space to accommodate all equipment associated with repowering, there have to be suitable CO2 storage opportunities, and (for cases in which biomass is co-processed with coal) biomass supplies have to be available so not all sites can accommodate repowering. However, the definition of repowering is broadened somewhat to include also the option of abandoning a site entirely and rebuilding at a greenfield site if the targeted site is unsuitable. The economics change only modestly in a shift from building a new plant at an existing site to building a new plant at a greenfield site. The economic benefits associated with saving the infrastructure were not taken into account.

An updated version of the GHGT-10 analysis shows that a coal-biomass co-production option with aggressive CO2 capture (the CBTL-OTA-CCS-29% system discussed earlier) could provide 287 MWe of electric power and 10,880 B/D of FTL transportation fuels. For GHG emissions prices > $40 a tonne and at the current crude oil price of $90 a barrel, the levelized cost of electricity (LCOE) for the coal-biomass plant with capture is lower than for the 543 MWe written-off coal pulverized coal plant being replaced. The LCOE is also lower than for all other decarbonization options considered.

This coal-biomass co-production system with CCS would reduce GHG emissions more than 90% relative to the fossil energy displaced and would entail a relatively modest energy penalty for CCS. Also water requirements for the system would be 1/3 less than for the written-off pulverized coal plant and only 1/2 of the water requirements for a CCS retrofit of the written-off plant. Moreover, the analysis showed that under a strong carbon mitigation policy, investors in this technology would be well protected against the risk of oil price collapse.

For perspective on these findings, the analysis showed that the CCS retrofit and natural gas combined cycle plants with and without CCS would require minimum GHG emissions prices of $70/tCO2e, $50/tCO2e, and $30/tCO2e before they would be competitive with the written-off plant venting CO2. An important finding is that CIGCC-CCS is not able to compete with the CCS retrofit. This will seem surprising to some, because, for new construction, CIGCC-CCS with precombustion CO2 capture offers a lower LCOE than a supercritical coal power plant with postcombustion capture. But CIGCC-CCS considered as a repowering option for an existing coal power plant site requires ~ 3 times the capital investment required for a CCS retrofit of a pulverized coal plant.

Although the average age of U.S. coal electric generating capacity is 38 years (in excess of the economic life of the power plants), it has heretofore not been practically feasible to consider repowering existing coal power plants sites with any kind of alternative generating capacity - because keeping these old written-off coal power plants running has been very profitable for the power companies. But these old plants are also very polluting, and the U.S. Environmental Protection Agency has several major regulatory initiatives underway including regulations to limit air emissions of criteria pollutants, Hg and other air toxics, and GHG emissions. As a result of these activities, some recent studies are projecting widespread retirements of old coal generating capacity over the next decade or so - with estimates ranging up to 150 GWe by 2030.

Williams has begun a dialogue with EPA officials, showing them the technological opportunities that their regulatory actions are opening up and the potential benefits to the local communities involved. He is also trying to understand the implications of their prospective regulatory actions relating to carbon mitigation for less desirable co-production opportunities. For example, in the absence of a price on GHG emissions, the building of co-production options that involve neither CCS nor the co-processing of biomass will be more profitable and offer a lower LCOE than the preferred CBTL-OTA-CCS-29% option under a market-oriented carbon mitigation policy. Will prospective EPA GHG emissions regulations constrain the construction of these carbon-intensive co-production options? And, more generally, what are the prospects that these EPA regulations will endure until a price-based carbon mitigation policy is eventually put in place?

Earlier, as a result of an Op Ed by Williams that was published in the Grand Forks Herald on this concept of repowering existing coal power plant sites with low GHG-emitting co-production systems, Williams and Brad Crabtree (Policy Director of the Great Plains Institute) were invited to meet with North Dakota's Senator Conrad. In subsequent discussions with Conrad's staff, Williams offered advice on a bill that the Senator was developing to encourage, via investment tax credits, the construction of up to 20 coal energy projects that would reduce CO2 emissions by at least 50%. Williams advice was that the incentive should be made available for systems that make electricity, make synfuels, and make synfuels + electricity but should specify neither what combinations of products are produced to qualify for the incentive nor specify how the 50% reduction in emissions is to be realized (e.g., via CCS or via biomass co-processing or via efficiency improvement or via other means or via some combination of these approaches). The final bill, The Coal Bridge Act of 2010 (co-sponsored by Senators Conrad and Hatch and introduced just before the Congressional recess in August 2010) crafts the incentive in the manner Williams recommended. The bill was not subsequently debated in the Senate last year and will have to be reintroduced in 2011 to be considered.

Prospects for Early CCS Action in China

Before CCS can be pursued as a routine commercial carbon mitigation strategy, commercial-scale demonstration projects are needed to address technical issues of scale and to provide an empirical basis for judgments on CCS viability as a major carbon mitigation option. G8 leaders have called for 20 large-scale CCS demonstrations during this decade. In an analysis carried out with Zheng LI (our long-time collaborator at Tsinghua University) and colleagues, we describe a unique demonstration opportunity in China: using the pure streams of CO2 at some of the facilities in China that make chemicals or fuels from coal for CO2 storage demonstration projects.

China is unique in the large number (nearly 400) of existing and planned projects for making ammonia, methanol, and other fuels and chemicals from coal (Figure 6). A natural by-product of these processes is a nearly pure CO2 stream. Collectively, these facilities will emit (once all are operating) some 270 million tonnes of CO2 per year. Taking advantage of the relatively low cost of capturing these CO2 streams (as compared with capturing CO2 from power plant flue gases), some of the 20 large-scale CO2 capture and storage (CCS) demonstration projects called for by the leaders from the G8 to be deployed during the next decade might be expeditiously located in China.

Our analysis identifies 18 coal-chemicals/fuels facilities, each emitting one million tonnes/year or more of CO2, that are within 10 km of prospective deep saline aquifer CO2 storage sites and an additional 8 facilities within 100 km. The potential CO2 storage basins are identified based on work by others. Our "Nth plant" cost estimates for the 18 projects where the CO2 source is within 10 km of a sink are a remarkably low $9 to $13/tonne of CO2.

These modest CCS costs suggest that there would be mutual value in international cooperation to support CCS demonstrations in China. By taking advantage of the relatively "cheap" CO2 in China and sharing the costs and the learning from CCS projects, the U.S. and China could each expend less money developing CCS technology while also speeding up the date by which each of them will be able to deploy the strategy commercially.

Figure 6. Map showing the
location of potential CCS
demonstration projects in
China. Coal-to-chemicals/fuels
facilities are marked by pins.
Large pins indicate coal-tochemicals/
fuels plants with
large pure CO<sub>2</sub> streams located
near prospective CO<sub>2</sub> storage
sites (light green areas).

Other activities relating to early CCS opportunities in China included Larson's chairing the review committee that evaluated proposals in the area of clean coal for the US-China Clean Energy Research Center (CERC) funded by the U.S. Department of Energy. Five proposals were reviewed in 2010. The one submitted by West Virginia University, emphasizing assessment of the CO2 storage potential in China, was the winning proposal. In addition, Williams is a member of the Working Group on U.S./China Cooperation on Clean Coal of the U.S.-China Strategic Forum on Clean Energy Cooperation that is being co-sponsored by The Brookings Institution and The China Institute for Innovation and Development Strategy. Williams has participated in two meetings of the Forum In this capacity (one in Beijing in October 2009 and one in Washington DC, 18-19 January 2011).

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Last update: March 23 2011
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